We have come across an intriguing case I’d like to share with you.

In the 2024 year, a member received employer contributions of $6,576.64 and made personal deductible contributions of $20,923.36 – a total of $27,500. The member also made a non-concessional contribution of $110,000 with a view to using the 3 year bring forward rule in the following year. This would have been fine if the $27,500 concessional contribution had been sourced exclusively from employer contributions OR personal concessional contributions, but the combination has caused an issue as it involved cents.

The ATO will only process personal concessional contributions in whole dollars. Where cents are involved, they truncate the amount, so the personal deduction became $20,923 reducing the total allowable deduction to marginally below the $27,500 allowable cap. This wouldn’t have been such a big deal if that’s all that happened, but it wasn’t. The ATO website states that a deduction can only be claimed in whole dollars and, if you make a personal contribution in dollars and cents, “the residual cents will remain a non-concessional contribution and will count towards the relevant cap.”

The result was that the member’s 3 year bring forward strategy was unintentionally triggered as they were regarded as having made a non-concessional contribution of $110,000.36 in 2024.

We have extensively researched this ridiculous situation and don’t believe there is a solution, but I’d be interested in hearing from anyone who has dealt satisfactorily with this issue previously.